Apostolides v Mantina EARTHMOVERS and Constructions Pty Ltd
[2018] FCCA 279
•7 February 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| APOSTOLIDES v MANTINA EARTHMOVERS & CONSTRUCTIONS PTY LTD | [2018] FCCA 279 |
| Catchwords: INDUSTRIAL LAW – Australian Workplace Agreement – long term employee paid a loading – whether permanent or casual employee – permanent employee entitled to annual leave – dismissal – whether adverse action or discrimination – no adverse action or discrimination – employee dismissed because unable to carry out inherent requirements of the work. |
| Legislation: Fair Work Act 2009 (Cth), ss.26, 44, 90, 113, 323(1), 340, 351, 546 Fair Work (Transitional Provisions and Consequential Amendments) Act2009 (Cth), Schedule 3, cl. 28 |
| Cases cited: Actrol Parts Pty Ltd v Coppi [2015] VSC 694 Board of Bendigo Regional Institute of TAFE v Barclay 248 CLR 500 Byrne v Australian Airlines (1995) 185 CLR 410 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 | ||
| Applicant: | MICHAEL JOHN APOSTOLIDES | |
| Respondent: | MANTINA EARTHMOVERS & CONSTRUCTIONS PTY LTD |
| File Number: | ADG 31 of 2016 |
| Judgment of: | Judge Young |
| Hearing dates: | 6, 7 and 8 March 2017 |
| Date of Last Submission: | 8 March 2017 |
| Delivered at: | Darwin |
| Delivered on: | 7 February 2018 |
REPRESENTATION
| Counsel for the Applicant: | Mr A Manos |
| Solicitors for the Applicant: | Mahony's Lawyers |
| Counsel for the Respondent: | Mr M Douglas |
| Solicitors for the Respondent: | Finlaysons |
THE COURT DECLARES THAT:
The applicant was employed as a permanent employee by the respondent from 8 May 2000 until 16 August 2015.
The applicant is entitled to be paid for accrued annual leave under clause 6.1 of the Australian Workplace Agreement between the parties (the AWA).
The applicant is entitled to payment in lieu of notice under clause 7.2 of the AWA.
THE COURT ORDERS THAT:
The matter is adjourned to 2 March 2018 at 2.15pm before Judge Young in Adelaide for further submissions.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT DARWIN |
ADG 31 of 2016
| MICHAEL JOHN APOSTOLIDES |
Applicant
And
| MANTINA EARTHMOVERS & CONSTRUCTIONS PTY LTD |
Respondent
REASONS FOR JUDGMENT
The applicant was employed by the respondent as a crushing plant operator in its quarry at Kapunda in South Australia. His employment began in 2000 and he was dismissed in August 2015.
The applicant makes various claims against his former employer which may be summarised as follows:
a)The applicant was a permanent employee rather than a casual employee and is entitled (i) to be paid accrued annual leave under section 90 of the Fair Work Act (“the Act”), (ii) a payment in lieu of notice under section 117 of the Act and (iii) a redundancy payment under section 119 of the Act;
b)The applicant’s dismissal from his employment constituted adverse action because of his physical disability (a previous injury to his right hand) in breach of section 351 of the Act and,
c)In the alternative, the respondent’s failure to provide work or remuneration for the applicant (after his dismissal) was because of the applicant’s exercise of a workplace right (a previous workers’ compensation claim) and/or to prevent the exercise of such a right in future in breach of section 340 of the Act;
d)The applicant was entitled to be paid long service leave under the Long Service Leave Act1987 (SA) and the respondent failed to pay the long service leave at the time the applicant’s employment ended (in August or September 2015) and did not do so until 26 September 2016 in breach of section 323(1) of the Act; and
e)The respondent breached the applicant’s contract of employment by not providing work or remuneration from early August 2015 which constituted a repudiation which was not accepted by the applicant until 10 December 2015. This was said to give rise to an entitlement to damages in respect of the intervening period.
The applicant seeks payments for unpaid annual leave, including additional superannuation payments, a redundancy payment and a payment in lieu of notice. He seeks compensation for non-economic loss and past and future economic loss which he claims was caused by the respondent’s adverse action, discrimination and breach of contract. Finally, he seeks the imposition of civil penalties.
Background
The respondent operates a large quarry and rock crushing operation. It has somewhere between about 30 employees (according to Mr Obbiettivo’s trial affidavit) and 60 employees (according to an answer he gave in cross-examination). Much of the respondent’s product is sandstone aggregate for use in concrete manufacture. The quarry occupies about 180 ha, including two pits, associated roads and storage areas, crushing plant, a concrete batching area, associated plant and equipment, generator sheds and administration buildings.
The applicant was initially employed as a fitter and diesel mechanic but at some later time became a crushing plant operator. The evidence seems to suggest that in the applicant’s initial period of employment there was only one crushing plant operator employed by the respondent but towards the end of the applicant’s employment there were at least two shifts and at least one other crushing plant operator was employed. The crushing plant is a very large and complex piece of machinery. It is integral to the respondent’s operations and almost 300,000 tonnes of product is crushed each year. There are only about two or three days of product stockpiled at any given time. The crushing plant operator is responsible for all aspects of the crushing plants operation, including supervising the crushing operation and carrying out routine maintenance and repairs. It was not in question that the applicant, as a crushing plant operator, performed a skilled and important role in the respondent’s operation.
Casual or permanent employee?
The applicant was interviewed and engaged by the then managing director of the respondent, Mr Manfred Obbiettivo, according to the applicant, in “late 1999 or early 2000”. Mr Manfred Obbiettivo died in 2003 and the current managing director of the respondent is his son, Mr Rino Obbiettivo. (Any further reference to “Mr Obbiettivo” will be a reference to Rino Obbiettivo). Mr Obbiettivo said that the applicant started work with the respondent “in around 2000”. Mr Obbiettivo annexed to his trial affidavit a reference dated 31 December 2001 given to the applicant for the purpose of a consumer loan. This said the applicant commenced work on 8 May 2000. This date seems consistent with the year-to-date pay recorded on the applicant’s payslip for the period 19 June 2000 to 25 June 2000 and I find that was the commencement date of the applicant’s employment with the respondent.
There is no written record of the terms of the applicant’s engagement. The applicant deposed that Mr Manfred Obbiettivo said that the respondent had not had a “[m]echanic at the quarry for quite a while and as a result there was plenty of work”. He said that Mr Manfred Obbiettivo told him that his hours would be “full time” and that he would be paid a “flat rate of $16 an hour”. He said that he agreed to these terms and he expected his role to be “ongoing subject to Mantina being happy with my work in an initial trial period”. The applicant said that Mr Manfred Obbiettivo never said that his employment was casual and the word did not come up at any time.
It is appropriate to be cautious about evidence given by a party to litigation about a conversation 17 years ago with a person now deceased. However, it is not in issue that there is no evidence of a written agreement containing the terms of the applicant’s engagement in 2000 and there is no suggestion that one was made. It is clear from the applicant’s employment history that he worked full-time hours for the respondent and many additional hours of overtime, other than at times when he was absent from work or on reduced hours due to injury, until the last month or so of his employment in August 2015. Although there is some variation in the hours, ordinarily the applicant’s payslips from the beginning of his employment show 38 hours a week paid at his base rate plus substantial overtime. According to ordinary usage of the phrase the applicant was employed “full-time”. The applicant’s hours of employment were consistent with Mr Manfred Obbiettivo having engaged him on a full-time basis. Similarly, the applicant was initially employed on a flat rate of $16 an hour as is apparent from his payslips.
Ordinarily one would expect a prospective employer and employee to discuss such an important term of an employment contract but for the reason given above I am unable to make any finding about whether there was any discussion between Mr Manfred Obbiettivo and the applicant about whether he was to be employed on a casual or some other basis.
The applicant’s payslips did not say he was employed as a “casual” nor do they contain any express statement that he was paid a casual loading. However, it is not in issue that the applicant was never paid for annual leave. In his trial affidavit the applicant said that he did not want to take annual leave and believed he was accruing it. He said he wanted to accrue it in case he needed it at some later point in his life. He said it was “like having money in the bank”. In cross-examination he also said that he did not take annual leave because he liked what he was doing and considered himself “a fairly important cog in the wheel” of his employer’s operation.
The applicant also admitted in cross-examination that he was not paid for public holidays. Although it was not the subject of specific cross-examination some of the applicant’s payslips appear to indicate this. For example, the payslip for the period 1 January 2001 to 7 January 2001 seems to indicate payment for four days at normal time, recognising a public holiday, plus some over time.
When it was put to the applicant that he had not been paid for sick leave he said that he could not remember taking any sick leave.
The applicant denied that these factors made it clear to him that he was engaged as a casual worker. The applicant appeared to be a man of at least average intelligence. He was articulate and spoke English fluently. I accept that there was no written agreement setting out the terms of the applicant’s employment and his payslips gave no express indication that he was being paid on a casual basis. However, it seems implausible that a worker would not seek to take annual leave at some time during 15 years of employment if he believed he was entitled to such leave. Similarly, the absence of payment for public holidays would seem likely to indicate to a person of ordinary experience and knowledge, such as the applicant, that he may be employed on a casual basis. Although I generally found the applicant to be credible I consider it likely that these factors indicated to him that he was treated as a casual employee at all relevant times. However, for the reasons set out below this is not determinative in my view.
Mr Obbiettivo said in his trial affidavit that apart from three part-time administration staff and the second in charge at the quarry who were “employed on a full-time basis” all other employees, including the applicant, were “casuals”. He said that all casuals were paid a “25% casual loading”.
In cross-examination Mr Obbiettivo conceded that there were other permanent employees of the respondent. He specifically acknowledged five permanent employees including an excavator operator, a mechanic and a blaster and said there could be “blue collar workers” as well. He ultimately suggested he did not know how many permanent employees were employed by the respondent and that Mr D’Allesandro, the company accountant/financial officer, may know the answer. Mr D’Alessandro swore an affidavit in the proceedings but did not address this issue.
Mr Obbiettivo was cross-examined about his statement that the applicant was paid a casual loading. Although conceding there was no express statement on the applicant’s payslips that he was a casual employee he said that the fact that he was a casual employee was apparent from the pay slips. He said that the payslips showed the applicant was paid an “allowance” (it was not described in more detail on the payslip). He said this was paid for each day based on half an hour of an employee’s normal hourly rate without a casual loading. By way of example, he pointed to the applicant’s payslips from early in his employment (the payslip for the period 30 October 2000 to 5 November 2000 is an example) that showed an hourly rate of $16 and a daily “allowance” of $6.90. Mr Obbiettivo said this was an allowance the respondent gave for a half hour lunch break. According to Mr Obbiettivo’s explanation, the difference between $16 and $13.80 (i.e. $6.90 x 2) or $2.20 (or 15.9%) represented the casual loading. When it was pointed out this was not 25% he said that the loading had been increased over time. He said that the 25% rate of the casual loading had not applied “when he [the applicant] started” but changed over time, increasing to what he said was the 25% loading at the time of the applicant’s dismissal.
There are some difficulties with Mr Obbiettivo’s evidence on this subject. As noted, the payslips do not refer to a casual loading. There was no direct evidence that the applicant was paid a casual loading at all other than Mr Obbiettivo’s evidence that its existence could be inferred in the way he described. The allowance also disappeared from the payslips (at least those in evidence) after 12 February 2001 so the basis for the calculation used by Mr Obbietttive was not available over the following years as the applicant’s hourly rate increased. There was no evidence, apart from Mr Obbiettivo’s assertion, that the loading had been increased over time to what he said was the 25% loading at the time of the applicant’s dismissal. There was no evidence about when the amount of the loading increased and no evidence about how or on what basis the loading was calculated or, indeed, if there was any calculation at all.
In recognition of these deficiencies the respondent applied on the third and final day of the hearing to adduce oral evidence from the respondent’s pay clerk who, according to the respondent’s counsel, would give evidence that whenever a pay rise was required for the applicant because of, for example, an industry wide pay increase she would do a calculation to ensure that the applicant’s pay was at least 25% more than the applicable rate in the award. Counsel said that the award used was the Metal Industry Award. He said this was the “wrong” award (the “right” award was said to be the Quarrying Award 2010 in the sense that it covered the applicant’s job and the respondent’s industry). The applicant opposed the respondent’s application and I refused it because orders for filing and service of affidavits of evidence-in-chief had been made months before, the trial had been adjourned once and if the evidence was to be permitted it would probably have necessitated further disclosure and an adjournment to another date.
Nevertheless, the respondent tendered, without objection, a screen shot dated 8 March 2017 of the applicant’s employee details from the respondent’s “Attache” payroll computer program recording the applicant’s “status” as “casual”. It was asserted by the respondent, without demur but without formal concession from the applicant, that the applicant had been described as a “casual” in the respondent’s payroll system since the commencement of his employment.
I consider it likely that the applicant was paid an amount in excess of award rates for permanent employees. I have little doubt that the applicant, who gave evidence that he had negotiated a pay increase with Mr Manfred Obbiettivo on threat of resignation, was generally aware of pay rates and scales and would have taken steps if he believed he was underpaid. Nevertheless, I do not feel I can make a finding that the applicant was paid a specific amount for a “casual loading” in the sense that phrase is commonly used. Similarly, I am not satisfied that the applicant was paid 20% or 25% more than a comparable permanent employee throughout his employment as was required for casual employees under the Quarrying Industry Award and the Quarrying Award 2010 respectively. As noted above, the method of calculating the casual loading suggested by Mr Obbiettivo produced a figure of 15.9%.
The award covering the applicant’s employment has relevance in this context. The agreed position of the parties was that prior to the applicant and the respondent entering into an Australian Workplace Agreement in 2007 the applicant was covered by the Quarrying Industry Award. The Quarrying Industry Award relevantly defined employment categories as follows:
Clause 4.2 Employment Categories
4.2.1 Weekly Hired Employment – Full-Time and Part-Time
The contract of hiring of every employee will in the absence of a contract in writing to contrary, be deemed to be a contract of hiring by the week.
4.2.2 Part-Time Employent
[omitted]
4.2.3 Casual Employment
A casual employee is one engaged and paid as such subject to the following conditions:
4.2.3.1 Casual employees may be employed to cover the absence of full-time employees during a period of annual leave, long service leave, sickness or accident or to fill a special short-term need of an establishment.
4.2.3.2 A casual employee must be paid per hour, 1/38th of the rate applicable for classification of work performed in accordance with the Award, plus 20%.
4.2.3.3 A casual employee must not be engaged on any day for more than the equivalent number of hours worked by weekly hired employees in the establishment.
4.2.3.4 The minimum term of engagement is eight hours.
4.2.3.5 Casual employees must not continue in employment in preference to full-time employees as a result of retrenchments or redundancy for any reasons.
4.2.3.6 A casual employee may apply for a full-time position within a company should a vacancy occur, providing the casual employee is able to perform the duties required to fill the vacant position.
There was no evidence of a “contract in writing to contrary” with the consequence that the applicant was deemed to be employed pursuant to a “contract of hiring by the week”. It was not in dispute that an employee employed pursuant to a contract of hiring by the week was equivalent to a permanent employee. It follows that, regardless of any understanding (or misunderstanding) of the parties, the applicant was, before 2007, not a casual employee but an employee deemed to be hired by the week under the Quarrying Industry Award. He was a permanent employee by force of statute rather than contract: Byrne v Australian Airlines (1995) 185 CLR 410, pp 421-422.
It is also noteworthy that the award required a casual employee to be paid an additional 20%, compared to the 15.9% derived from the calculation suggested by Mr Obbiettivo.
Each of the parties pointed to some other documents that were said to be relevant to the question of whether the applicant was a permanent or casual employee. The respondent relied on a workers’ compensation claim form dated 28 May 2001 that was submitted by the applicant. In answer to the form’s question “What are your normal gross weekly earnings?” there is a handwritten notation, “$16 per hour Casual”. The applicant denied this was his handwriting and said it must have been added after he signed the document. The handwriting is not the same as the handwriting in the rest of the form which was acknowledged by the applicant as his. I am satisfied that the notation was not written by him.
The respondent also pointed to the reference mentioned above dated 31 December 2001 given to the applicant for the purpose of obtaining a loan for a new washing machine. That document contained the description “Employment Status: Casual”. It was put to the applicant in cross-examination that the description of his employment status was correct. His answer was to the effect that he saw it at the time and believed it was an error but he was in urgent need of a new washing machine and did not think it was worth correcting. Consistently with my finding that the applicant probably believed that he was a casual employee I do not accept that answer. The reference also contained the statement “Although Michael is casual, his weekly hours normally exceed 38 per week. He normally works overtime including Satudays (sic) and Sundays if required”. This was written by Mr Obbiettivo and I find it was an accurate description of the applicant’s working pattern at that time.
The applicant pointed to an undated job description for a “Crushing Plant Supervisor”. He was named as the “occupant” and the “type of appointment” was “Permanent”. It appears this document was obtained by a freedom of information application to SA WorkCover. In cross-examination Mr Obbiettivo initially acknowledged the document was accurate but prevaricated when asked about the description “Permanent”. Although Mr Obbiettivo’s signature does not appear on the document it says that it was “approved by” him. Mr Obbiettivo suggested the document was created in relation to the applicant’s workers compensation claim in 2009 but otherwise professed not to recognise it. I consider the document was likely to have been either created or approved by Mr Obbiettivo but otherwise its provenance and purpose is unclear. Whether the job description actually applied to the applicant may be doubted. The parties did not dispute that the applicant’s job was a “crushing plant operator”.
The applicant also pointed to a typed record of a conference between the applicant, Mr Obbiettivo and a rehabilitation provider on 6 May 2009 where the applicant’s “employment status” was described as “full-time”. It was suggested that Mr Obbiettivo had either given this description himself or concurred in it. That is possibly correct. In cross-examination Mr Obbiettivo appeared to struggle to explain the difference between a “full-time” and a “permanent” employee and appeared at times to equate them.
The use of these documents as extrinsic evidence is of limited assistance in my view, reflecting the difficulties in unequivocally describing the nature of the applicant’s employment. This is reinforced by the parties’ ignorance of important elements of the employment relationship and a tendency to reconstruct in accordance with their different interests in the litigation. I have found that, at least until 2007, the applicant was a permanent employee rather than a casual employee because of the operation of the Quarrying Industry Award. Both the applicant and the respondent appear to have been unaware that the Quarrying Industry Award applied. They appear to have been mistaken about the applicable award because, from about 2002, the applicant’s payslips refer to the SA Metal Industry Award. Neither party suggested this was the correct award covering the applicant. No evidence was given about its terms.
By 2007 the applicant had been employed by the respondent on a full-time basis for about seven years. He ordinarily worked at least 38 hours a week and usually worked many additional overtime hours. As crusher operator he was an integral and important part of the respondent’s enterprise. He was expected to be available to work each day on a full-time basis and was so. If he had not been available that would have constituted a considerable obstruction and interference with the smooth running of the respondent’s operation which was not likely to be accepted by the respondent. He was not at any time in his employment before his dismissal in 2015 stood down or told he was not required for work because of fluctuations in the respondent’s requirements for labour. In his trial affidavit Mr Obbiettivo said:
The respondent engages operational employees as casuals because it provides flexibility when we need to increase or decrease employee numbers due to customer demands or when weather means that we cannot operate the quarry. For example, when it is raining or if there has been recent rain, this restricts the activities that we can do, including blasting. In wet weather, we generally roster fewer employees on. Employing casuals allows us to keep wage costs flexible to demand.
I find that this statement has never applied to the applicant.
On the other hand, the applicant was not paid for annual leave or public holidays or sick days and neither he nor the respondent believed he was entitled to be paid for them. He was paid more than the usual hourly rate, apparently under an inapplicable award, but I cannot identify by how much. Because of these matters, and only these matters, both the applicant and the respondent believed he was a “casual” employee. The other attributes of the applicant’s employment, including its long term, regular and systematic nature, were ignored in arriving at this belief. In truth both were mistaken because, if for no other reason, he was deemed to be a permanent employee under the applicable award.
On 28 April 2007 the applicant and the respondent signed an Australian workplace agreement (“the AWA”) under the Workplace Relations Act1996. The Employment Advocate acknowledged receipt of a declaration form in a letter dated 3 May 2007 and said the AWA started operating from the date of lodgement which I take to be on or about that date.
There was no evidence about any discussions or negotiations leading up the signing of the AWA apart from the applicant’s evidence in his trial affidavit that Mr Obbiettivo said to him “that the Agreement wouldn’t change anything”. The applicant said that there was no practical difference in his work hours or arrangements after signing the AWA. These claims were not contested by the respondent.
According to the applicant’s payslips in February 2007 he was then paid $25.32 an hour. The hourly rate of pay in the AWA approved in May 2007 was $25.62. There was no evidence that the slight increase in pay (1.1%) between the two dates was the result of entering the AWA.
It was not in dispute that the AWA continued to have effect notwithstanding the repeal of the Workplace Relations Act because it was an agreement-based transitional agreement pursuant to cl. 28, Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009. It was not in dispute that the applicable modern award under the Fair Work Act, the Quarrying Award 2010, did not apply to the applicant.
The parties agreed that the question of whether the applicant was a casual or permanent employee was to be determined by the construction of the AWA. Neither sought rectification of the AWA nor suggested that it did not reflect the common intention of the parties, objectively determined.
The relevant parts of the AWA are set out below.
Clause 2.4 deals with classification and work requirements. Relevantly it provides:
2.4 Classification and Work Requirements
2.4.1 Your initial appointment under this Agreement is that identified on the Signatory Page. You are, subject to your qualifications, experience and fitness, required to perform all of the tasks of the position, including those tasks that are incidental or of a lower classification to the main functions of your position.
The Signatory Page contains the names and signatures of the signatories to the contract, Mr Obbiettivo and the applicant, and the date of signing. The page also leaves two spaces for the description of the employee’s “Employment Category” and “Classification”. Both have been left blank.
Part 3 defines the categories of employment. Relevantly it provides:
Part 3. Categories of Employment
3.1 Permanent Employment
3.1.1 Full-time Employment
This means that you are employed on a permanent basis and are required to work an average of 38 hours a week plus reasonable additional hours.
3.1.2 Part-time Employment
This means that you are employed on a permanent basis and are required to work less than 38 ordinary hours.
3.2 Casual Employment
3.2.1 This means an employee who is engaged as a casual employee and whose hours of work and employment are subject to the employee’s availability to work and the Company’s need for their services.
3.2.2 There is no obligation on the Company to provide a casual employee with work. Rostering of casual employees is at the discretion of the company.
3.2.3 As a casual employee you are contracted by the hour. You will be paid the appropriate Ordinary Rate of Pay prescribed in clause 5.1.1.
3.2.4 As a casual employee you are not entitled to any leave entitlements (other than long service leave), public holidays, period of notice on termination or redundancy provisions. You are entitled to unpaid carers leave (see Leave provisions).
3.2.5 As a casual employee you may be terminated or resign at any time with one (1) day’s notice. Provided that, this prescription will not affect the right of the Company to dismiss you without notice for misconduct or other lawful cause for summary dismissal.
Part 5 deals with remuneration. Relevantly it provides:
5.1 Rate of Pay
5.1.1 Your Ordinary Hourly Rate of Pay will be (insert $). [in handwriting] $25.62.
5.1.2 The Ordinary Hourly Rate of Pay is an aggregate all-purpose rate that includes all allowances and leave loading that may otherwise apply. The Ordinary Hourly Rate of Pay does not include a site allowance, nor are such an allowance payable.
Part 6 deals with leave and public holidays. Relevantly it provides:
6.1 Annual Leave
6.1.1 If you are a permanent employee you are entitled to four (4) weeks paid annual leave per year. Annual leave will accrue on a pro rata basis each four (4) weekly period at the rate of 1/13 of ordinary hours worked.
…
6.1.5 Annual leave is payable at your ordinary rate of pay (being the applicable ordinary rates described in Schedule 1) for the number of ordinary hours you would have worked during the period of annual leave. Annual leave hours paid will be deducted from your accrued entitlement.
…
6.1.7 Leave loading has been subsumed into your Ordinary Hourly Rate of Pay.
6.3 Public Holidays
…
6.3.2 If you are a permanent employee you will not lose ordinary pay as a result of a public holiday falling on a day that you would normally be rostered to work. You will be paid at the Ordinary Hourly Rate for that day.
Clause 6.1.5 contains a reference to “Schedule 1”. There was no other reference to that schedule in the AWA and there was no such schedule attached to the AWA in evidence. There was no evidence about the reason for that. There is no definition of “ordinary rate of pay” in the AWA and it is unclear what role the reference to Schedule 1 might be intended to achieve in the document. There is no indication in the AWA that the failure to attach such a schedule is consistent only with an objective intention that the AWA create a contract of employment on a casual basis. It is possible, although there was no evidence about the matter, that such a schedule was unnecessary because its function was, in all cases, fulfilled by the specification of the “Ordinary Hourly Rate of Pay” in clause 5.1.1.
The respondent submitted that the reference in clause 3.2.3 to a casual employee being paid the “Ordinary Hourly Rate of Pay” in clause 5.1.1 and the specification of that rate in the AWA was conclusive. It said that this was consistent only with a contract of employment on a casual basis and, therefore, it could be deduced that the objective intention of the parties was to create such a contract. This submission must be rejected. There are express references to the “Ordinary Hourly Rate of Pay” in parts of the AWA that could only apply to a permanent employee. There are two instances. Clause 6.1.7 in dealing with leave loading for annual leave says that the “loading has been subsumed into your Ordinary Hourly Rate of Pay”. The second example is in clause 6.3.2 which deals with public holidays and provides for a permanent employee to be paid on public holidays at their “Ordinary Hourly Rate for that day”.
It is clear that the “Ordinary Hourly Rate of Pay” in clause 5.1.1 applies, in whatever amount is specified, to both casual and permanent employees. Further, the definition of “Ordinary Hourly Rate of Pay” is said to include “all allowances and leave loading that may otherwise apply”. It does not mention any casual loading or any loading for the absence of an entitlement to payment for annual leave or public holidays. There is nothing in the definition or in the use of the phrase elsewhere in the AWA to suggest that it applies only to casual employees. On the contrary, it is clear that it is intended to apply to both casual and permanent employees.
Although the respondent’s primary submission, which I have rejected, was that a plain reading of the AWA logically led to a conclusion that it was a contract of employment on a casual basis its alternative submission implicitly asserted that the contract was ambiguous and sought to rely on extrinsic evidence. The applicant also implicitly asserted that the AWA was ambiguous and similarly sought to rely on extrinsic evidence. Although opinions may differ about whether a particular document is ambiguous I accept that the AWA does not expressly or by necessary implication define the contract of employment as either casual or permanent. To that extent it may be said to be ambiguous. In both cases the extrinsic evidence relied on was largely about the subjective intentions and understandings of the parties at different times in their employment relationship and the largely uncontested practical employment arrangements in place.
The classic exposition of the law on the use of extrinsic evidence in the interpretation of contracts is Mason J’s in Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 352:
The true rule is that evidence of surrounding circumstances is admissible to assist in the interpretation of the contract if the language is ambiguous or susceptible of more than one meaning. But it is not admissible to contradict the language of the contract when it has a plain meeting… [W]hen the issue is which of two or more possible meanings is to be given to a contractual provision we look, not to the actual intentions, aspirations expectations of the parties before or at the time of the contract, except insofar as they are expressed in the contract, but to the objective framework of fact within which the contract came into existence, and to the parties presumed intention in this setting.
Although there appears to have been some tendency to relaxation of the requirement for ambiguity for extrinsic evidence to be admitted this is still considered an orthodox statement of the law[1].
[1] Cheshire and Fifoot, Law of Contract, 11th ed, [10.12].
As noted above, I have found the evidence of the parties as to their subjective intentions and aspirations to be of limited value, not least because both were ignorant of the true nature of their legal relationship before entering into the AWA. I consider the relevant extrinsic evidence or surrounding circumstances to be as follows:
(a)The applicant was deemed to be a permanent employee by the Quarrying Industry Award from the time he was employed in May 2000 until he entered the AWA in 2007. The applicant was wrongly recorded as a “casual” in the respondent’s internal pay records from the commencement of his employment.
(b)The applicant was employed by the respondent on a full-time basis from May 2000 to August 2015.
(c)The applicant was a skilled worker who performed an important and integral role operating the respondent’s crushing plant.
(d)The applicant worked consistent and regular hours of at least 38 hours a week plus regular hours of overtime.
(e)The employer expected the applicant to be available for work for at least 38 hours in each week during set hours and for additional overtime, sometimes up to 50 or 60 hours a week in total.
(f)Until the last month or so of his employment the applicant was never told not to come to work or told that he was not required because of the operational requirements of the employer.
(g)The applicant was not paid for annual leave or for public holidays and he did not believe he was entitled to be so paid.
(h)Although the applicant was paid more than normal there is no evidence that he was paid a “casual loading” of any particular percentage. The employer was not able to give evidence of any particular calculation of a “casual loading”. The employer’s evidence on this issue was unsatisfactory.
(i)The employer told the applicant before he signed the AWA that “it wouldn’t change anything”.
(j)The applicant’s hourly rate of pay remained substantially unchanged after entering the AWA.
The difficulty (and irrelevance) of relying on subjective intentions is revealed when those intentions are inconsistent or based on mistaken assumptions. As in this case, both parties may have subjectively considered the applicant to be a casual employee or, at least, one not entitled to annual leave or pay on a public holiday and, possibly, other entitlements of a permanent employee. Equally, the parties may have intended that entering the AWA would not “change anything”, unaware that the applicant was actually a permanent employee.
The parties also relied on case law to support their opposing constructions of the AWA. The applicant referred in particular to the decision of Barker J in Williams vMacMahon Mining Services [2010] FCA 1321, 201 IR 123 dismissing an appeal from a decision of Lucev FM (as then was) in Williams v MacMahon Mining Services [2010] FMCA 49, 182 IR 104. In that case an employee entered into a written contract that described him as a casual employee and which specified he would be paid a loading in lieu of paid leave entitlements. The primary judge reasoned that the employee was not a casual employee as “traditionally defined” and that “casual employee” in s.227 of the Workplace Relations Act had the same meaning as the “traditional definition”. He held that the description in the contract was not determinative of the issue. He found that the work was performed according to a stable roster, was not subject to fluctuation and was not irregular or uncertain. There was a mutual expectation of continuity of employment and the employee did not work for short periods of time on an irregular basis. He also found that the payment of a flat hourly rate that purported to include a loading for various leave entitlements was more indicative of a casual employment relationship than not but concluded the employee was not a casual employee. Barker J also noted, referring to Personnel Contracting Pty Ltd (t/as Tricord Personnel) v CFMEU (2004) 141 IR 31, that it is well understood that a description such as “casual employee” will not override the true legal relationship that arises from a full consideration of the circumstances: Williams v MacMahon Mining Services at [38].
After a detailed review of the case law Barker J upheld the primary judge’s conclusion.
The respondent relied in particular on the decision of the Full Bench of the Fair Work Commission in Telum Civil (Qld) Pty Ltd v CFMEU [2013] FWCFB 2434. In that case the relevant employees were subject to an enterprise agreement made under the Work Place Relations Act 1996. The employees were employed on a regular and systematic basis for a particular project and their employment came to an end on the completion of the project. They sought redundancy payments on the basis that they were permanent employees. It was not in dispute that the employees were recorded as casual employees in the company records and this was stated on their payslips. It was not in dispute that they were paid a 25% casual loading as provided for in the enterprise agreement but it was argued that the regular and systematic nature of the employment meant they were permanent employees.
In its consideration of the issue the Commission observed that the specification of casual employment in Federal awards has
… diverged from the (ill-defined) general law position to a position where, by the time of award modernisation process, for many, if not most, Federal awards, an employee was a casual employee if they were engaged as a casual (that is, identified as casual at the time of engagement, perhaps with a requirement of a writing) and paid a casual loading. The Full Bench recognised that this approach has led to a position where employees with regular and systematic hours on an ongoing basis could still be “casual employees” under a Federal award (at [25]).
The Commission observed that the Fair Work Act provides for an interrelated system of National Employment Standards, modern awards, enterprise agreements and, in some cases, workplace determinations or minimum wage orders. It said that, having regard to the objects and purposes of the legislation, the legislature intended that the components of the system should “interact consistently and harmoniously” (at [58]). It said that the legislature intended that the meaning of “casual employee” in one part of the system should be consistent with the meaning given in another part and:
[58] Subject to any terms to the contrary, a reference to a “casual employee” in an enterprise agreement (or agreement based transitional instrument) will have a meaning consistent with the meaning in the underpinning modern award (or pre-reform award/NAPSA).
The Commission distinguished MacMahon Mining Services v Williams on the basis that that decision was concerned with the meaning of “casual employee” in section 227 of the Workplace Relations Act and it was accepted that that Act did not define the expression and so it was given its ordinary common law meaning (at [59]).
These two cases were considered by Flick J in Tomvald v Toll Transport Pty Ltd [2017] FCA 1208. His Honour characterised the “potential divergence” (at [55]) of approaches between them as focussing on the substance of the relationship (at [52]) or the terms of engagement (at [54]). In the case before him his Honour found it was unnecessary to resolve the extent to which there was divergence in the two approaches. He found that the employee was expressly engaged as a casual employee, his employment had the character of casual employment and he remained throughout employed as a casual employee (at [58]).
In this case neither party contended, as in MacMahon, that there was an inconsistency between the formal characterisation of the applicant’s employment and its substance so that a general law definition should be determinative. The respondent submitted that the terms of engagement in the AWA were consistent only with casual employment. I rejected that submission for the reasons given above.
The parties did not submit that there was any relevant definition in the Work Place Relations Act or its successor legislation, the Fair Work Act. However, the respondent did submit, in accordance with the approach in Telum, that its construction of the AWA was more consistent with the legislative system or the underlying award, said to be the Quarrying Award 2010 (notwithstanding that the Quarrying Industry Award applied in 2007). The respondent submitted that the wording of the AWA was similar to the wording of the Quarrying Award 2010 and the AWA should be construed consistently with it. There are difficulties with this submission. First, the Quarrying Award 2010 was not in force in 2007 and there is nothing to suggest that the parties were (or could have been) aware of its terms in a way to indicate an intention that the AWA be construed in conformity with it. Secondly, the categories of employment in the Quarrying Award are full-time, part-time and casual rather than permanent and casual (and clause 10.2 requires the employer to inform the employee in writing of their category of employment). A full-time employee is defined as “an employee who is employed to work an average of 38 ordinary hours per week.” A casual employee is defined as “an employee employed and paid as such” and must be paid 1/38th of the weekly ordinary time rate of pay for their classification plus a casual loading of 25%. I take “employed … as such” to mean engaged as such.
I cannot see that these definitions shed any light on the construction of the AWA. The applicant was, I have found, employed to work at least 38 hours a week so that is consistent with employment other than casual under the Quarrying Award 2010. The basis of his engagement in 2007 is not clarified by the definition of “casual employee” in an award that came into force three years later.
Both the approaches in MacMahon and Telum are of limited application in the circumstances of this case and, ultimately, I am left to characterise the employment by reference to the AWA and the surrounding circumstances when it was made.
The AWA defines full-time permanent employment as follows: “This means you are employed on a permanent basis and are required to work an average of 38 hours a week plus reasonable additional hours”. The use of the word “permanent” as part of the definition has a degree of circularity but its ordinary meaning suggests an indefinite or long term of employment and would exclude temporary or short term employment. The other part of the definition refers to a requirement to work 38 hours a week and reasonable additional overtime. In my view the applicant’s employment satisfies each of the elements in this definition.
The AWA defines a casual employmee as “… an employee who is engaged as a casual employee and whose hours of work and employment are subject to the employee’s availability to work and the Company’s need for their services”. The applicant was initially engaged as a permanent employee due to the operation of the Quarrying Industry Award. I have found that the respondent expected the applicant, both when his employment was governed by that award and under the AWA, to be available for work for at least 38 hours in each week during set hours and for additional overtime. He was engaged on those terms both at the beginning of his employment and under the AWA. He was not employed on the basis of his availability and the respondent’s need for his services. On the contrary, he was expected to be present daily during set hours for a minimum of 38 hours a week plus additional overtime. These factors are inconsistent with casual employment as defined.
The belief of the applicant and the respondent that he was not entitled to annual leave or payment for public holidays was certainly mistaken for the period between the commencement of the applicant’s employment in 2000 and signing the AWA in 2007. Nevertheless, this points to a belief of the applicant and the respondent that he was a casual employee. I do not consider this factor to be decisive. An employee may mistakenly believe he is a casual employee and not a permanent employee: Tomvald v Toll Transport at [65]. The evidence did not clearly show the applicant was paid as a casual employee. Although the evidence indicated that the applicant was paid more than normal it did not show he was paid a “casual loading” of any particular percentage of normal pay, still less the 20% casual loading required under the Quarrying Industry Award or the 25% casual loading under the Quarrying Award 2010.
I consider the correct interpretation of the AWA is to define the applicant’s employment as permanent.
It follows that applicant has unpaid entitlements for annual leave and payments in lieu of notice under clause 7 of the AWA.
Set-off?
The respondent submitted that if I found that the applicant was entitled to payments for annual leave then there should be a “set-off” against those entitlements of the amounts that were said to have been paid in excess of his entitlements as a permanent employee. The basis of the claimed right of set-off was not addressed in more detail by the respondent. There are a number of difficulties with such a claim. Counsel for the respondent said that there ought to be a set-off in his written submissions during the trial but the factual basis of such a claim was not pleaded in the respondent’s further amended response. A set-off is usually understood to mean the setting-off of mutual debts or the raising of some other equitable or legal claim in defence. A set-off must be capable of being pleaded as a separate action and recoverable by action. If the claim cannot be sued for separately it cannot be pleaded as a set-off[2]. The respondent did not say what action might constitute its claim for set-off. It is possible to imagine some kind of restitutionary claim based on mistake but in the absence of pleadings that is speculation.
[2] Laws of Australia [5.2 .1350] referring to Rawley v Rawley (1876) 1 QBD 460 (CA)
A claim described as “set-off” but possibly more like a defence was advanced by the respondent in Williams vMacMahon Mining Services. There the respondent argued that the effect of having paid a “casual loading” to an employee, later found by the court to have been a permanent employee, was that the employee was paid in advance for annual leave as part of the flat hourly rate. The argument went that the respondent therefore had a defence to the claim because on termination there were no monies payable for leave accrued and not taken: MacMahon at [60]. The court rejected that argument on the basis that section 173 of the Workplace Relations Act rendered such an attempt at contracting out of the relevant minimum employment standards to be of no effect. A similar approach under the Fair Work Act was considered by the Full Bench of the Fair Work Commission in Canavan Building Pty Ltd [2014] FWCFB 3202. There an employer applied for approval of an enterprise agreement containing a term that sought to meet the entitlement of permanent employees to annual leave by paying an increased hourly rate. The Full Bench found that such a term would be in breach of the National Employment Standards and, in particular, sections 91, 92 and 93 of the Fair Work Act.
The respondent also submitted that I should take into account the applicant’s workers compensation award and redemption of future income support. It was not suggested that there was any prospect of double payment and I can see no other basis on which the workers compensation payments could be relevant: CFMEU v Hail Creek Coal Pty Ltd [2016] FCA 1032, [53].
I am not satisfied that the respondent is able to raise any relevant claim, whether by way of set-off, defence or otherwise, against the applicant’s entitlement to payment for annual leave.
Claims of discrimination and adverse action
The applicant was injured at work in March 2009. He was operating the crushing plant when his right hand became caught in a conveyor belt. He suffered a degloving injury as a well as a crush injury to his right hand and fingers. After surgery and rehabilitation he returned to work. It is not necessary to trace in detail the history of the applicant’s workers compensation claims (there were other minor claims in 2001, 2006 and 2014), the various assessments of his capacity for work over the period or the various changes made to the applicant’s working arrangements to deal with his incapacity. He received workers compensation payments for income support until 30 June 2015.
On 30 June 2015 the SA Workers Compensation Tribunal made an order by consent in the following terms (so far as is relevant):
1. The decision of the Compensating Authority dated 1 May 2015 and issued pursuant to Section 43 of the Act is VARIED to the extent that the worker is entitled to a lump sum of $158,569 based on a 43% Whole Person Impairment of the upper extremity, right hand, wrist and digits as assessed by Dr Jennings in his report of 10 December 2014.
2. …
IT IS NOTED THAT:
1. These Orders are part of a wider agreement between the parties including that the worker’s future entitlement to weekly payments of income maintenance and medical expenses are to be redeemed effective from the day after the date of these Orders by way of a lump sum payment hundred and $199,378.08.
2. . …
The report from Dr Jennings was not in evidence.
The applicant gave evidence that from late July 2015 he began to receive telephone calls from the respondent advising him not to come to work. Initially the calls were from Mr Kennelly, the quarry supervisor, but later he received calls from one of the receptionists in the office. He said that the reason usually was because of bad weather or no reason was given. He said that after 16 August 2015 he did not return to work and he was told there was no work for him. In broad outline, the respondent’s evidence about the circumstances of the applicant’s cessation of work was consistent with what the applicant said. I find that the last day of the applicant’s employment with the respondent was 16 August 2015.
The evidence leads to the conclusion that the respondent’s actions in telling the applicant not come to work constituted dismissal of the applicant. I have found the applicant was a permanent employee. The respondent was not entitled to treat him as a casual employee by telling him not to come to work and in doing so the respondent terminated the applicant’s employment.
The question to be resolved is whether the respondent’s reason or reasons for dismissing the applicant constituted a contravention of the Act.
The applicant alleged a contravention of section 351 of the Act in the following terms:
The Respondent breached section 351 of the FW Act by taking adverse action against the Applicant (in the form of an injury or altering his position to prejudice) (sic) by not providing work or remuneration to the Applicant between early August 2015 and the date the employment ended because of his physical disabilities, including, the Applicant’s previous injury to his right hand (Discrimination Breach).
The applicant also alleged a contravention of section 340 of the Act:
Further and in the alternative [to the alleged breach of section 351] the Respondent breached section 340 of the FW Act between early August 2015 and the date the contract ended by:
a) taking adverse action against the Applicant, namely not providing work or remuneration to the Applicant (and then by injuring him or altering his position to his prejudice);
b) because of and/or to prevent the Applicant’s workplace right (sic), namely his WorkCover claim (being a benefit, process or complaint made under a workplace law). (Adverse Action Breach).
Notwithstanding the awkward drafting it was clear in the proceeding that the applicant alleged (1) a contravention of section 351 of the Act by reason of the respondent’s termination of his employment because of his physical disabilities, including his previous injury to his right hand and (2) a contravention of section 340 of the Act by reason of the respondent taking adverse action against him by termination of his employment because he exercised a workplace right: his previous WorkCover claim, and to prevent the exercise of work place right: a future WorkCover claim. Although the drafting of the allegation in relation to section 340 by referring to “his WorkCover claim” implies an existing claim there was no evidence of any existing claim. I understood the applicant to mean to refer to any potential WorkCover claim that might accrue and be made in future.
The references to the “date the employment ended” and the “date the contract ended” were, as I understood the applicant’s case, intended to draw attention to the distinction made by the applicant between the date he ceased work and the time, according to him, he accepted the respondent’s repudiation of his contract of employment some months later. I will deal with this issue later in these reasons.
In response to these allegations the respondent pleaded:
a) It [the respondent] offered the applicant fewer hours as a result of market conditions and diminished need for labour in its business.
b) It was under no obligation to provide the employee, as a casual, with any work at all.
c) At all material times following his injury, the applicant could not safely perform the inherent requirements of his position of Crushing Plant Operator and other maintenance duties as required to be performed.
d) The applicant’s poor performance at work in around 22 July 2015 was sufficient to entitle the respondent to terminate the applicant’s employment on performance grounds:
i.as of July 2015, the applicant’s duties as a Crushing Plant Operator included responsibilities for operation and shutdown of crushing plant;
ii.on Monday, 20 July 2015, the applicant incorrectly shutdown the crushing plant and left uncrushed rock jammed in the crusher, causing a loss of four hours of production time and financial loss to the respondent of approximately $40,000;
iii.on Tuesday, 21 July 2015, the applicant prematurely shut down the crushing plant conveyors, leaving rock and dirt on the conveyors overnight, which material was exposed to the weather overnight and became wet, requiring significant additional work to clear the then muddy material off the conveyors before the plant could be restarted, causing a loss to the respondent of approximately $10,000;
iv.in around July 2015, incorrectly attempting to clean newly installed screens, causing irreparable damage, causing a loss to the respondent of approximately $8,000.
In addition, the respondent alleged that:
… to the extent that the applicant’s disability was an operative factor in deciding not to provide the applicant with work, the decision was not discriminatory on the grounds that it was made based on the inherent requirements of the applicant’s position.
Section 340 of the Act relevantly provides:
(1)a person must not take adverse action against another person:
(a)because the other person:
(i)has a workplace right; or
(ii)has, or has not, exercised a workplace right; or
(iii)proposes or proposes not to, or has at any time proposed or propose not to, exercise a workplace right; or
(b)to prevent the exercise of a workplace right by the other person.
It was not in dispute that the making of a workers compensation claim would constitute a “workplace right” for the purposes of this section.
Section 351 of the Act relevantly provides:
(1)An employer must not take adverse action against a person who is an employee, or prospective employee, of the employer because of the person’s race, colour, sex, sexual orientation, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin.
(2)However, subsection (1) does not apply to action that is:
(a)…
(b)taken because of the inherent requirements of the particular position concerned; …
Also relevant is section 360 of the Act which provides:
For the purposes of this Part, a person takes action for a particular reason if the reasons for the action include that reason.
Section 361 of the Act reverses the onus of proof in relation to the alleged contraventions. It relevantly provides:
(1)If:
(a)in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b)taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
Consideration of this issue requires an examination of the respondent’s reason or intent in terminating the applicant’s employment. The onus rests on the respondent to show that the termination, having regard to its reason or intent, did not contravene the Act. If there are multiple reasons for the termination the onus rests on the respondent to show that the reasons did not include a reason that meant the termination contravened the Act.
Although I am conscious that the onus of proof does not rest on the applicant it is convenient to begin with a consideration of his evidence.
The applicant gave evidence of a dispute in 2014 concerning the extent of his incapacity which was resolved in the Workers Compensation Tribunal. This evidence was apparently intended to support an adverse inference against the respondent. However, as the rights of the respondent were, I assume, subrogated to the workers compensation insurer the conduct of the proceedings says little or nothing about the respondent. The applicant also referred to an incident in about December 2014 when he injured his knee at work. After consulting with his doctor he decided to make a workers compensation claim for the injury. He said he told Mr Obbiettivo who said aggressively “you are not putting in another bloody claim” or words to that effect. He said that he was then put on the afternoon shift, rather than his usual morning shift, as “punishment”. He said he was unhappy about working in in the afternoon shift because it would involve more time sitting in the crushing box. He said he wanted to keep doing his usual duties which involved more of the maintenance and repair work. He said he was still capable of performing those duties. It is to be noted that the evidence was that the maintenance and repair work on the crushing plant was physical work requiring strength and dexterity.
There was evidence that from late August 2014 the respondent was worried about the applicant’s physical capacity and attitude to work. The respondent put in evidence a memorandum dated 26 August 2014 made by Mr D’Alessandro following a discussion with Mr Obbiettivo. The memorandum noted that “Mantina Quarries” (but presumably Mr Obbiettivio in reality) would prefer to have the applicant working in the control room but that he did not want that role. It noted that the applicant preferred to do light maintenance and welding work and had been instructed not to perform any heavy work, to seek the assistance of co-workers and not to perform the work himself. It noted that the applicant ignored such instructions and preferred to do physical work himself. It said that the applicant would not delegate and was unable or incapable of supervising others effectively and would do the work himself, counter to instructions. It noted a fear that the applicant may injure himself. It noted that the applicant’s rheumatoid arthritis was affecting his performance and complained that he was did not start on time and was leaving early because of it. It noted that the consequence was that other workers had to be retrained to compensate for the applicant’s restrictions and his “lack of ability to follow instructions in relation to supervisory practices and heavy lifting”. Neither Mr Obbiettivo nor Mr D’Alessandro were cross-examined about this memorandum.
It was put to the applicant in cross-examination that his evidence about Mr Obbiettivo’s verbal response to the news of his new workers compensation claim in December 2014 was false. The applicant denied that his evidence was false and his denials appeared plausible. Mr Obbiettivo did not give evidence about his alleged verbal response. I think it was likely that Mr Obbiettivo said this or something similar. However, Mr Obbiettivo did give evidence about the decision to move the applicant to the afternoon shift. He said that he knew that the applicant suffered from rheumatoid arthritis and during the last several years of the applicant’s employment he had noticed him moving and walking with difficulty. He said he limped, stooped over and moved very slowly. He said that one morning in late December 2014 he saw the applicant struggling to get out of his car and, after asking the applicant about it, the applicant told him that he was “struggling to get up in the morning”. Mr Obbiettivo said he had a discussion with the applicant and asked whether it would help if he moved to the afternoon shift. He said the applicant agreed to this and began working on the afternoon shift from January 2015. Mr Obbiettivo’s evidence was not challenged in cross-examination. It appears that the move to afternoon shift also involved a reduction in the amount of physical work the applicant was required to do. Although the memorandum of 26 August 2014 would suggest the discussion with the applicant may have occurred earlier than December 2014 the general outline of Mr Obbiettivo’s evidence was consistent with the concerns raised in the memorandum.
In cross-examination the applicant said of the change to the afternoon shift “Once I started doing that job, I realised its – I was much better off for it. I should been doing it a long time ago”. I am satisfied that the decision by Mr Obbiettivo to move the applicant to the afternoon shift was not a punishment but, on the contrary, expression of a concern by Mr Obbiettivo for the applicant and a desire to accommodate his disability, including his rheumatoid arthritis. I am satisfied that the applicant’s evidence interpreting the change as “punishment” reflected a recurrent theme in his evidence whereby he seriously downplayed his significant physical limitations.
The applicant also referred to an incident in May 2015, according to him, in the context of the ongoing dispute about the workers compensation claim. He said that Mr Obbiettivo was “venting his frustration” in a discussion with him and said “if this keeps up we may have to part ways” or words to that effect. The applicant was not cross-examined about this and Mr Obbiettivo did not give evidence about it. Mr Obbiettivo was frank in evidence in describing his frustration with the workers compensation system, which he said was archaic and unfair to employers. It was unclear from the applicant’s evidence what was being referred to by the words “if this keeps up”. The sentiment is generally consistent with Mr Obbiettivo’s unfavourable view of the workers compensation system and I think that it is likely that Mr Obbiettivo said those or similar words. Nevertheless, there were indications that the relationship between the applicant and the respondent was becoming strained by mid-2015 due to reasons other than the applicant’s unresolved workers compensation claim.
Mr Obbiettivo gave evidence that there were “performance issues” with the applicant from about January 2015. He said that he did not believe the applicant was performing maintenance, such as greasing moving parts on the crushing plant, as he was required to do. He said there were “concerns” about the applicant’s attendance at work as well although these were not detailed. He alleged that on 20 July 2015 the applicant incorrectly shut down the crushing plant and the next day prematurely shut down the conveyors leaving material on the conveyors. He said this became wet overnight and was cleaned away with difficulty. He said these two events caused losses of approximately $50,000. He said that on another occasion the applicant incorrectly attempted to clean new screens causing “irreparable damage” at a cost of around $8,000. The only evidence on this issue was Mr Obbiettivo’s. There was no other direct evidence about the damage, no evidence of the basis of any calculation of the claimed monetary loss or evidence of the cost of replacement of the screens said to have suffered “irreparable damage”. There was no evidence of any written warning or instructions to the applicant.
On 22 July 2015 Mr D’Alessandro, the respondent’s accountant/ financial controller, wrote an e-mail to the respondents workers compensation insurer in the following terms:
Could we please discuss [the applicant’s] status as soon as possible.
His work performance is causing considerable concern at the Quarry.
His attitude is poor and his lack of attention to the requirements of his role is causing considerable damage not only to expensive production equipment but also to the moral (sic) of other workers and is compromising safe operating processes.
In the last two days he has;
1.Incorrectly shut down the crushing plant and left uncrushed rock jammed in the crusher, causing a loss of 4 hours of production time, approx. cost $40K.
2.Prematurely shut down the crushing plant conveyors, leaving rock and dirt still on the conveyors overnight, causing the material to become wet overnight requiring significant maintenance to clear muddy material off the conveyor’s before the plant could be restarted, approx. cost $10K.
3.Incorrectly attempting to clean newly installed screens, causing irreparable damage, approx. cost $8K.
He obviously knows he is getting a payout and has developed a “do not care attitude”, he does not listen to directions given by the quarry director and the concern is that he is an accident waiting to happen, his actions are not conducive to safe operating processes as the rectification work caused by this inattention/incompetence/carelessness is quite dangerous in itself.
Basically we need to move him on as soon as possible but we are unsure about our position in regards to the new Return to Work SA requirements.
It would help if we could expedite his payout as soon as possible as we feel that once he receives his payout he will move on anyway.
Could we please discuss urgently as we may need some mediation in resolving the situation to return the client to normal and safe operating environment.
Please advise.
Regards,
Albert D’Alessandro
It was not suggested that Mr D’Alessandro had any direct knowledge of the complaints against the applicant about the crushing plant.
The applicant was cross-examined in relation to the allegations in the e-mail about his attitude and his operation of the crushing plant. In response to a question about his attitude he conceded that he had been “depressed” at times. He denied causing any damage to production equipment. He said that there had been a disagreement with Mr Obbiettivo on one occasion because he shut down the crusher 10 minutes early to clear an obstruction. Otherwise he denied the allegations in the e-mail.
I consider the lack of any documents supporting Mr Obbiettivo’s allegations against the applicant to be surprising, although the e-mail from Mr D’Alessandro on 22 July 2015 does appear to be corroborative, at least of a complaint made to him at the time by Mr Obbiettivo. Mr Kennelly, the quarry supervisor, did not address the subject in his trial affidavit. The applicant was steadfast in his denial of the allegation of causing damage. On the balance of probabilities I consider that some such incident or incidents occurred although I am unsure of the details. However, no warning, written or otherwise, was given to the applicant that his employment may be at risk if there were any further incidents of that kind and the termination of his employment did not take place until the following month. I am not satisfied that the incident or incidents merited summary dismissal or justified termination of the applicant’s employment.
There were other allegations made by the respondent about the applicant’s conduct at various times, such as refusing to comply with instructions not to do heavy work but, again, there is no direct documentary evidence to support these allegations, such as a written instruction or a written warning such as one might expect if an employee deliberately refused to follow an employer’s instructions. It was also alleged that the applicant left work early and that his attendance was poor. There was, apparently, a time recording system used by the employer and I would have expected some documentary support for these allegations if true but none was provided.
The e-mail from Mr D’Alessandro to the respondent’s insurer is, however, evidence that the respondent was determined to terminate the applicant’s employment.
I consider it likely that the applicant was struggling with his work from late 2014, if not earlier. I accept Mr Obbiettivo’s evidence about the applicant’s physical condition in December 2014 and the reasons for moving him to the afternoon shift. This evidence was supported by other evidence, including the report of Dr Obele, an occupational physician, which I consider below. In addition to his physical problems the applicant was suffering from depression around this time. He acknowledged this himself. He also said that the work in the crushing box became “boring” after his move to the afternoon shift in January 2015 because no physical work was involved. Nevertheless, he acknowledged that the change to the afternoon shift and the relative absence of physical work “was the best thing that could have happened”. The applicant also said in cross-examination that there were times when he was “getting pretty sore” but he did the job expected of him. Although it is not entirely clear whether this was a reference to a period after January 2015 the context of the answer appears to suggest that.
The applicant drew a distinction between his ability to do his job as crushing plant operator before January 2015 and after then when he moved to the afternoon shift. It was the agreed position of both the applicant and Mr Obbiettivo that the tasks of the crushing plant operator varied somewhat depending on whether the operator was working on the morning or the afternoon shift. Mr Obbiettivo said that there were two parts to the role of crushing plant operator. The first part involved routine maintenance and breakdown repairs and the second part involved the operation of the plant. Both parts of the role were done on a daily basis. He said that much of the routine maintenance was done “pre-start” at the beginning of the morning shift. The “pre-start” preparations also involved clearing away built up dust and rock material on the moving and static parts of the crushing plant. This involved shovelling and the material could be heavy.
As far as maintenance was concerned, there was high wear and tear on the machinery and a constant need for maintenance, including oiling and greasing of bearings and moving parts and the replacement of fittings. He said that the tools required for maintenance work included spanners, shifters, sledgehammers and grease guns. Sometimes the work required the operator to crouch and work in awkward positions. The crushing plant is large and has walkways up the length of each conveyor. The operator has to walk on the walkways to inspect or grease parts of the plant. In summary, the maintenance aspect of the role of crushing plant operator is physically demanding and involves a great deal of walking on and around the crushing plant.
The second part of the role involved operating the plant from a control room. The control room has a view over most areas of the crushing plant and has video screens showing areas not otherwise readily visible. Through control panels the operator is able to start and stop all aspects of the operation. There was evidence that in the control room the operator was seated. The control room was air-conditioned and there was a refrigerator and tea and coffee making facilities.
The applicant’s description of his work was generally consistent with the respondent’s description. The applicant said that he did not initially want to do the afternoon shift work because it involved less of the maintenance and repair work which he enjoyed. In his trial affidavit he described his work on the afternoon shift as follows:
This position generally was not as physically demanding as what I was used to and I really just had to oversee the plant and make sure everything was okay. There were still times however when I would swap and go out to the plant and start doing some shovelling and manual labour so I was still doing some physical work though this was only occasionally. I tried to keep it to a minimum.
Both Mr Obbiettivo and Mr Kennelly, the quarry supervisor, gave evidence that they had instructed the applicant to avoid the heavier work and, in Mr Kennelly’s words, to “leave the shovelling to others”. Mr Kennelly said the applicant did not comply with this instruction. It is unclear from their evidence when this instruction was given but I accept that some such instruction was likely to have been given. The applicant himself acknowledged that he was expected to call on the assistance of others if any heavy work such as shovelling was required. The applicant’s description of the tasks he performed after January 2015 on the afternoon shift includes reference to “some shovelling and manual labour”. I am satisfied that contrary to the expectations, and probably direct instructions, of the respondent the applicant continued to do some heavy work such as shovelling and manual labour. He did this because he enjoyed it and was bored by the sedentary nature of work limited to the control box.
Mr Staehr, a witness called by the applicant, said in his trial affidavit that he witnessed the applicant performing physical work, although he did not say when. He said:
I had seen him use a sledgehammer, use a shovel and find a way to fix nuts and bolts. He did all of the physical duties like the rest of us. Michael did not let his injury slow him down or affect the way he was able to perform his duties.
However, a different picture emerged in cross-examination. It was put to him that the applicant was suffering from increasing physical problems as time went on at the quarry. He answered “He found it hard, but he always managed to do it”. In my view, this answer was not really consistent with what he said in his affidavit. According to the respondent, Mr Staehr had been dismissed from his employment for incompetence and, although he denied that, his oral evidence suggested a disgruntled former employee. I place little weight on his affidavit evidence and, specifically, I do not accept that he heard Mr Kennelly, the quarry supervisor, say that the respondent had “to get rid of [the applicant]”. Mr Staehr also gave evidence that the decision to move the applicant to the afternoon shift appeared, on the basis of his observations, to be “punishment” and calculated to force the applicant’s resignation. I have found that was not the purpose of the move to the afternoon shift.
Mr Owen was also a witness called by the applicant. He said he saw the applicant every day at work and worked with him “in the morning”. He said in his trial affidavit that “I never personally witnessed Michael struggling or having difficulty with his duties at work”. He then went on to describe the applicant performing shovelling, welding, using a sledgehammer, hand drills and performing repairs. In cross-examination he asserted that he had seen the applicant doing physical work “the whole time”, including in 2015. It was clarified in re-examination that he worked on the morning shift and had not observed the applicant after his move to the afternoon shift. I have difficulty accepting Mr Owen’s evidence that the applicant did not appear to be struggling or having difficulty with his work, including heavy physical work. It is inconsistent with the position that the applicant himself ultimately adopted in cross-examination that the move to the afternoon shift, with its reduced requirements for physical labour, was a good thing for him.
Mr David Apostolides, the applicant’s son, also gave evidence. David Apostolides was employed by the respondent as a mechanic until his retrenchment in 2016. He said he observed his father doing tough physical work that he himself would find difficult but his father “didn’t even look like he struggled”. He said he saw him “performing the duties of his role and never having any issues with the task”. I do not accept this evidence and it is inconsistent with other evidence about the applicant’s physical capacities. However, I consider that a more accurate picture emerged in cross-examination of the witness. He agreed that his father’s level of dedication to the job suffered because of the deterioration in his physical health. He also agreed that the job was physically demanding for his father and it was an easier job for a young man. He agreed that his father was reluctant to acknowledge that his physical capacities were diminishing. He also agreed that he observed his father’s increasing medical problems and that it was less safe for his father to work in the quarry than it was before.
The respondent relied on a medical report from Dr Obele, a consultant occupational physician, who conducted an assessment of the applicant on 12 October 2016. She provided a lengthy and detailed report canvassing the applicant’s medical history, assessing his physical limitations and range of movement, his ability to perform the requirements of his job as a crushing plant operator, assessing whether it was safe for him to continue to work in the role and whether it was reasonable to make changes to accommodate his disability. She was not required for cross-examination.
According to her report the applicant confirmed that his work involved heavy lifting and awkward manoeuvring in confined spaces, as well as climbing on very high equipment, to maintain and repair the plant. He said that he swept the crusher screens a few times a day and shovelled spilled material regularly. He said that he sometimes required “a bit of help” changing welding rods and knocking rods out of the welder but otherwise he generally worked by himself with no assistance. She asked him about documentation (presumably relating to his workers compensation claim) that stated he had required assistance with heavier tasks from around 2010 onwards. The applicant told her this was untrue and that he was perfectly capable of doing all the tasks himself. He told her that the respondent offered him a job “sitting in a glass box overseeing the entire plant to make sure that it runs properly” which required “pushing buttons and close observation”. He told her that he found it boring and did not want to do that job. In consequence, he said, he got out of the control box and did the heavier manual tasks and a range of rock crushing activities.
The applicant confirmed to Dr Obele that he suffered from rheumatoid arthritis which was diagnosed many years earlier. When asked how this affected his function he told her that every day when he climbed up and down the machine and balanced along the catwalks he “felt as though he was walking on broken glass”. He said his feet and ankles “get warm and swell” and he gets pins and needles in his lower legs which had become worse over time. He said his foot arches had collapsed and his feet were now flat. He said he was taking multiple medications for his rheumatoid arthritis. He said his doctor had recently increased the medication because he was getting more swelling, warmth and discomfort of his joints. He also confirmed that he had rheumatoid arthritis in his hands, wrists and, probably, his elbows, knees and lower back, although he was not sure. He said that his doctors said told him that he probably had osteoarthritis as well. He said that both his knees had been particularly “sore and swollen recently”.
The applicant told Dr Obele that he had been involved in a road accident in 2013 where the driver of the other car was killed. He also said that around that time a relative had been diagnosed with a terminal illness. He said he became depressed but did not find psychological assistance to be helpful. He said that he would often finish work early and therefore leave at 2 PM. He said he was not always really “present” at work and he “may have taken a few safety shortcuts at times” but was not prepared to elaborate. He reported an accident in February 2013 where a dump truck slid down a hill and a leg came off a screening deck but he had repaired it “before anyone noticed”.
He reported “no other problems” apart from occasional shortness of breath and a limp in the left leg as a consequence of a shooting accident when he was young. He said that his right leg was also “more limpy” because it had been “red, hot and swollen” on several occasions in the last two years. He also said that he did not sleep well because of the compensation claim and suffered from poor attention, memory, concentration, and mood.
Dr Obele conducted a physical examination of the applicant. She noted the 2009 degloving injury. She said this injury was well healed but the applicant was left with “residual reduced range of right little finger motion, reduced grip strength, tendency to drop things, reduced fine motor dexterity and fragile skin over the graft”. She noted his rheumatoid arthritis of the hands, wrists, feet and ankles and possibly also knees and that the applicant was on a high dose of rheumatoid medications. On examination there was warmth, swelling and thickening of his joints, particularly of his wrist, knuckles and ankles, with a reduced range of motion. She noted evidence of chronic obstructive respiratory disease as a result of the applicant’s smoking history.
The applicant told Dr Obele that he continued doing maintenance and repairs until August 2015 and used heavy equipment such as crowbars, sledgehammers, large spanners and broke rocks that were jammed in the machine, crushers and belts. Dr Obele asked the applicant about other reports stretching back to 2010 suggesting that he was not doing heavy manual tasks and his co-workers were assisting him. He said this was untrue and he had done all the duties by himself and that the documentation “was a lie”. Dr Obele noted a consistent theme among the medical reports that the applicant should be doing supervisory work only.
Dr Obele said it was difficult to reconcile the applicant’s severe medical problems with his account of doing continual heavy manual and physical work. She did not accept that he could physically have managed all of this in the last few years in view of his deteriorating rheumatoid arthritis and osteoarthritis. On the basis of the tests she conducted she was of the view that his rheumatoid arthritis and osteoarthritis was deteriorating.
Dr Obele said the applicant was unstable on his right leg and his general balance tests were abnormal. She said he had reduced vibration and proprioception sensation in both lower legs, which was a significant feature in someone who balanced a lot during his work.
Dr Obele was asked to assess whether the applicant was able to safely perform the inherent requirements of his role. She made a reference to what I take to be her letter of instructions which was not, as it ought to have been, attached to her affidavit. However, in context it appears she was asked to assess the role against the requirements of a Crushing Plant Operator set out in the Quarrying Award 2010 and some supplementary information provided by the employer, presumably in the missing letter of instructions. The relevant instructions appear to be adequately summarised in the report.
Dr Obele said that, in her opinion, the applicant was not capable of fulfilling the requirement to “conduct crushing and screening plant operations” if it involved, as she presumed it did, changing screening decks, conveyor belts and tail drums. She said the applicant was not capable of heavy manual roles involving lifting of awkward or large pieces of metal, carrying these up inclines or climbing into precarious positions to attach pieces of metal to catwalks, feed hoppers or screening decks. She said it was not clinically possible for him to do these tasks because of a reduced range of motion of his cervical, thoracic and lumbar spine, balance problems and reduced movement, swelling and tenderness of his hands, feet and knees
In relation to the requirement to “operate programmable logic control systems” she said this involved pushing buttons and being able to look around the entire plant from above. She said the operator would need to visualise what is going on, ensure that the plant was running smoothly and anticipate problems. She thought, given the applicant’s chronic health issues, fatigue may be an issue in these tasks.
She was of the opinion that the applicant would have difficulty with the requirement to “operate medium vehicles” because he would have physical difficulty gripping the wheel and steering a medium truck, pulling himself in and out of the truck because of his rheumatic problems in his upper and lower limbs and she thought he may also have trouble operating the foot controls due to rheumatoid and osteoarthritis in his ankles and feet.
In relation to the requirement to “conduct minor repairs and maintenance” Dr Obele noted that it was not clear what was involved in this requirement. However, she noted that changing magnesium crushers, doing minor welds, oiling, replacing bearings and sweeping the skirts, which she considered “minor” in a rock crushing plant, would be physically difficult for the applicant. She gave some other examples of minor repairs which she believed would be difficult for the applicant. She concluded that even minor repairs and maintenance were not medically possible for the applicant with his medical problems, particularly his swollen, tender and sore wrists, hands, ankles and feet, bilateral knee problems and his reduced range of motion of his spine and hips, as well as his balance problems.
She also considered some additional requirements provided by the respondent. These included:
· lifting heavy objects up to 20 kg in weight which she concluded could not be done regularly by the applicant;
· shovelling which in her view would be difficult for the applicant because of the requirement to grip with both hands, repetitive flexion and extension of both elbows and rotational movements at both shoulders; use of a sledgehammer which she thought was too heavy for the applicant to use appropriately and potentially unsafe for other workers standing nearby;
· she did not believe he had the necessary manual strength or dexterity to use large or long spanners or other tasks requiring good manual dexterity;
· she did not believe it was possible for the applicant to crouch or walk in awkward positions to remove and replace bearings and drums because of quadriceps wasting, tenderness and swelling of his right knee and tenderness of his left knee, signs of osteoarthritis in both knees as well as fluid on his right knee, a lax anterior cruciate ligament of the right knee, inflamed ankles and reduced proprioception and vibration sensation of both lower limbs and abnormal balance;
· working between 35 and 60 hours a week was not clinically feasible for the applicant in a manual role because it would increase his fatigue and put stress on his muscles, bones and joints and if long hours were added to the mix of the applicant’s medical conditions she considered he was at high risk of injury, aggravation of all his illnesses, an acceleration of all his medical conditions and he should not work for more than 40 hours a week in a sedentary role;
· work involving heavy plant and machinery with difficult terrain (sand and gravel) where the worker is required to do heavy lifting, fine motor movements and awkward manoeuvering in confined spaces in all weathers on a busy construction site is dangerous and safety critical and should not be performed by a person with the applicant’s range of medical conditions as described.
Dr Obele summarised her opinion by saying that the applicant was “not physically capable of doing this kind of work in August 2015, because it was simply too manually and physically difficult, and his work would not have been safe for his medical conditions”.
She said that in August 2015 and at the time of assessment the applicant was capable only of a “supervisory light demand role”. He was not capable of heavy lifting, pushing, pulling or carrying over 10 kg; repetitive bending, squatting, crouching, kneeling or crawling; safety critical work; work at heights; work around water; work in slippery environments such as working in rock dust in the rain; repetitive bending and twisting of the body; forward reaching and manual handling in awkward or sustained positions; activities requiring fine motor movements and digital dexterity; and any activities which required a good degree of balance and coordination.
Dr Obele said the tasks the applicant could perform were related to his technical and plant related knowledge, perhaps involving training others how to do the job. It would not be practical training around the plant but would be “ground-based, and of a more theoretical nature”.
Dr Obele was asked what adjustments could be made by the respondent to enable the applicant to perform the requirements of the job. She said that, theoretically, there were several modifications and adaptations that could be considered. Part of these related to reducing fatigue and she suggested that the respondent could pay for taxis for the applicant to attend work, providing parking near the worksite and ensuring that the applicant did not have to climb stairs, steps, ladders, ramps or platforms. She said that working hours could be altered to include later starts, flexible hours, no shift work and no work after 6 PM. She said that work tasks could be modified to reduce the amount of lifting, carrying, pushing, pulling, bending, above shoulder work, pinching and gripping and repetitive tasks, perhaps by having other workers allocated those tasks. She said that ergonomically appropriate equipment such as climbing aids, rails, gripping and handling aids and foot controls, knobs and buttons could be altered to require less force to use them and a “buddy” could be provided to help the applicant with difficult tasks. She suggested full-time assistance from an experienced occupational therapist or physiotherapist to assist and if that was not possible the employer could consider transferring the applicant to another branch of the business.
She considered that adjustments and modifications to the crushing plant were likely to be difficult because it is machinery that cannot be easily modified to accommodate workers with disabilities as serious as those of the applicant. She did not consider it feasible to put handrails and proper platforms around all aspects of the crushing plant. She considered there were no feasible adjustments, modifications or adaptations that can be made to the plant. She concluded that it was simply not possible for the applicant to return to his work in the crushing plant operation. She said an employer would need to be aware that the applicant has a chronic, progressive rheumatoid condition that is unlikely to improve, despite medications, and is likely to deteriorate over time. She said it would be important that an employer ensure that the applicant’s work tasks did not accelerate his progressive health deterioration.
In conclusion she said that the only role the applicant would be capable of was a “sedentary supervisory role” of the kind described above.
Some aspects of applicant’s job described in the supplementary information provided by the respondent did not appear to have been expected of the applicant after January 2015 such as, for example, lifting heavy objects or shovelling. However, I find that the job description used by Dr Obele, based on the requirements set out in the Quarrying Award 2010 and other parts of the job description provided by the respondent, was an appropriate description of the inherent requirements of the applicant’s job.
I do not accept, as was submitted by the applicant, that his job in the control box after January 2015, fitted the description of a “sedentary supervisory role” or a “supervisory light demand role” which was “ground-based, and of a more theoretical nature”. It is clear from the evidence that the job of the applicant as crushing plant operator on the afternoon shift, while involving less physical work than on the morning shift, still involved many tasks that, in Dr Obele’s opinion, the applicant could not do safely do or do at all, such as, at a minimum, maintenance greasing and oiling and overseeing the operation from the control box, including safely operating buttons and controls.
Reference should be made to the undated job description of “Crushing Plant Supervisor” mentioned above. Although the applicant was named as “occupant” of the position, the origin and purpose of this document was unclear. It appears to have been generated in relation to the applicant’s workers compensation claim. It may have been generated as part of the respondent’s suggestion to the applicant in 2014 or earlier that he restrict his activities to work in the control box. This may have been the proposal that the applicant told Dr Obele he did not want to do. It describes a position of “Crushing Plant Supervisor” but it was not said, as I understood the evidence, by either party that this was, in fact, the applicant’s job. The job description is different to that used by Dr Obele and, as the description suggests, involved supervising the crushing plant operation, including supervising crushing plant operators. While there is a greater supervisory role in this description than the description used by Dr Obele it also referred to a requirement of “maintenance, relocation, repair, alteration, modification of equipment and supplies” and “performing and supervising emergency work during breakdown to ensure a return to regular operation in a timely manner”. The requirements also included data entry and maintaining a database and an ability to demonstrate tasks to other workers. To the extent that the job description required working around the crushing plant and performing repairs and emergency work it also contains inherent requirements that, in Dr Obele’s opinion, the applicant could not satisfy.
Mention should be made of a report dated 7 November 2014 by Dr Simone Ryan, consultant occupational physician, annexed to the applicant’s trial affidavit. This report was not filed in accordance with trial directions for the filing of affidavits and I was not aware of the report until after the trial began. Counsel for the applicant did not expressly say that he did not rely on the report and there was no objection to it from counsel for the respondent. I asked if Dr Obele was the only expert witness and I was told by counsel for the respondent, without demur from counsel for the applicant, that she was and she was not required for cross-examination. Accordingly, I consider that the applicant did not rely on the report and I will give it no further attention.
A consideration of whether there has been discrimination against the applicant because of his disability requires consideration of whether the applicant would be unable to carry out the inherent requirements of the particular work, even if the respondent made reasonable adjustments for the applicant. Section 21A of the Disability Discrimination Act1992 (Cth) relevantly provides:
(1)This Division does not render it unlawful for a person (the discriminator) to discriminate against another person (the aggrieved person) on the ground of a disability of the aggrieved person if:
(a)the discrimination relates to particular work (including promotional transfer to particular work); and
(b)because of the disability, the aggrieved person would be unable to carry out the inherent requirements of the particular work, even if the relevant employer, principal or partnership made reasonable adjustments for the aggrieved person.
(2)For the purposes of paragraph (1)(b), the following factors are to be taken into account in determining whether the aggrieved person would be able to carry out the inherent requirements of the particular work:
(a)the aggrieved person’s past training, qualifications and experience relevant to the particular work;
(b)if the aggrieved person already works for the discriminator – the aggrieved person’s performance in working for the discriminator;
(c)any other factor that it is reasonable to take into account.
There is no doubt that the applicant’s training, qualifications and experience satisfy the requirements of the work of crushing plant operator. The applicant’s admission to Dr Obele that he continued to do heavy work after he was instructed, I am satisfied, to seek assistance or not do such work indicates that the applicant may have been unlikely to accept instructions intended to ensure that he worked safely. I am satisfied that the applicant, on occasions, ignored relevant instructions, including after January 2015, intended to ensure his safety and to avoid him being injured. This indicates that any modification of the applicant’s role or work intended to ensure that he worked safely or without injury would have been at risk of being undermined by his failure to follow instructions.
I also accept Dr Obele’s opinion that no physical modifications of the crushing plant that would permit the applicant to work as crushing plant operator were feasible. I accept her opinion that the only work suitable for the applicant was a sedentary supervisory role on the ground and of a “more theoretical nature”. I am satisfied that this would have required the creation of an entirely new position for the applicant and this was not a “reasonable adjustment”.
I am satisfied that the termination of the applicant’s employment by the respondent was not a breach of section 351 of the Act because the applicant was unable to carry out the inherent requirements of the particular work, that is, crushing plant operator.
There may be multiple reasons for an action. The applicant submitted that Mr Obbiettivo admitted in cross-examination that one of the reasons he terminated the applicant’s employment was to prevent a workers compensation claim. The passage of cross-examination is set out below:
Counsel: You – to prevent the applicant from bringing a workers compensation claim and everything that came with it, you stopped offering him shifts?
Witness: I stopped offering him shifts because of concern for Michael’s safety.
Counsel: And one of the concerns you held was that he might suffer a new injury; you’ve accepted that?
Witness: That’s correct.
…
Counsel: If he suffered an injury at work, he would have brought a claim; you’ve accepted that?
Witness: Well, then…
Counsel: And I’m asking you…?
Witness: Yes.
Counsel:… did you stop offering him work to prevent that situation occurring?
Witness: To prevent Michael being injured. Yes.
Counsel: Which would have resulted in a workers compensation claim too?
Witness: Yes.
Counsel: Now, there are a number of reasons that have been given by Mantina in these proceedings about why it stopped offering him work. One of them is his physical condition; and you agree with that?
Witness: Yes.
Counsel: Risk of injury; correct?
Witness: Yes.
I do not agree that this contains the admission that counsel submitted was made. Mr Obbiettivo clearly stated that his concern was that the applicant may be injured at work. Given the report of Dr Obele I accept that this was a reasonable concern. The witness was simply conceding the obvious: that the consequence of a work injury was likely to be a workers compensation claim.
I am satisfied that the termination of the applicant’s employment by the respondent was not a breach of section 340 of the Act because the applicant exercised a workplace right, proposed to exercise a workplace right or to prevent the exercise of a workplace right by the applicant. I am satisfied that the termination was because of the applicant’s inability to perform his job safely or at all. This was the “substantial and operative” or “operative or immediate” reason for the applicant’s dismissal: Board of Bendigo Regional Institute of TAFE v Barclay 248 CLR 500, [127], [140].
Redundancy
In its further amended response the respondent, intending to rebut the claim that the applicant’s employment was terminated for a prohibited reason, asserted that one of the reasons that it terminated the applicant’s employment was because of “market conditions and a diminished need for labour”. The respondent gave evidence that it experienced an operational loss in July and August 2015 and Mr Obbiettivo said in his trial affidavit that:
I made the decision to no longer offer shifts to the Respondent (sic – “applicant” is intended) primarily because of the applicant’s health and his attitude, but also because we had a reduced need to crush product at around that time. Those financial and operating reasons were part of it but safety and his health were the driving reasons.
There was no evidence of the termination of the employment or the standing down of any other employees or any other measures to deal with the asserted downturn. I have a degree of scepticism about the respondent’s claim but given it was not challenged and, indeed, was embraced as an admission by the applicant it must be an accepted at face value.
The AWA provides for redundancy payments in certain circumstances. In clause 7.3.1 it gives a definition: “Redundancy occurs when we decide that we no longer wish the job you have been doing to be done by another employee of the Company”. There are other provisions dealing with transfer to lower paid duties and alternative employment that are not relevant for present purposes.
Clause 7.3.5 provides as follows:
Employees Exempted
This clause does not apply where your employment is terminated for a reason other than redundancy, or if you are a casual employee of any kind, an employee serving a probationary period or an employee engaged for a specific period of time or for a specific task or tasks.
I am satisfied that the substantial and operative reason for the termination of the applicant’s employment was because of his medical and physical conditions and his consequent inability to satisfy the inherent requirements of the work. In my opinion the exemption should be interpreted to mean that if there are multiple reasons for the termination of an employee’s employment, including a real, substantial or operative reason other than redundancy, the exemption should apply. To that extent I am satisfied that the applicant’s employment was terminated for reasons that included “a reason other than redundancy”.
In his written submissions the applicant asserted that in the case of multiple reasons for dismissal it was enough to trigger the obligation to make redundancy payments if one of those reasons was redundancy. The only case cited in support of that submission was UES (Int’l) Pty Ltd v Harvey (2012) 215 IR 263. That case concerned the unfair dismissal provisions of the Act. The question for the Full Bench of Fair Work Australia was whether, among multiple reasons for termination, there was a valid reason – redundancy. The passage of the judgment cited in the submissions, paragraphs [69]-[70], related to that question, not multiple reasons for redundancy. Further, the paragraphs cited are from the minority judgment and do not reflect the majority reasoning. This case was of no assistance.
Long service leave
I have found the applicant was dismissed on 16 August 2015, with that being his last day of work. It was not in dispute that a long service leave entitlement arose under clause 6.5 of the AWA pursuant to the Long Service Leave Act 1987 (SA) (LSL Act) and that it was not paid until 16 September 2016. Subsection 8(4) of the LSL Act relevantly requires that
A payment in lieu of long service leave made under this Act on the termination of a worker’s service -
a) …
b) must be made to the worker immediately on the termination…
Enforcement, offence and penalty provisions for non-compliance are provided for in the LSL Act.
The applicant submitted that the respondent’s failure to pay the applicant’s long service leave entitlement on the termination of his employment constituted a breach of section 323 of the Act for which a civil penalty ought to be imposed. The applicant did not make any submissions as to the Court’s jurisdiction or cite any authorities in support of this proposition. The respondent made no submissions on the subject.
Section 323 of the Act relevantly provides:
Section 323 Method and Frequency of Payment
323 (1) An employer must pay an employee amounts payable to the employee in relation to the performance of work:
a) in full (except as provided by section 324); and
b) in money by one, or a combination, of the methods referred to in subsection (2); and
c) at least monthly.
The subsection does expressly deal with long service leave. While section 113 of the Act deals with award-derived long service leave it does not exclude State and Territory laws that deal with long service leave and does not apply if an AWA that came into operation before the commencement of the Part applies to an employee, as is the case here. Section 26 of the Act expressly preserves the operation of some State and Territory industrial laws. Section 26 of the Act relevantly provides:
1.This Act is intended to apply to the exclusion of State or Territory industrial laws so far as they would otherwise apply in relation to a national system employee or a national system employer.
2.A State or Territory industrial law is:
(a)…
(b)…
(c) A law of a State or Territory that applies to employment generally and deals with leave (other than long service leave or leave for victims of crime);…[emphasis added].
The full operation of the LSL Act (SA) is preserved and, as noted, that Act has its own system of enforcement, offences and penalties.
In my view the Commonwealth legislature is unlikely to have intended to create a parallel but inconsistent system of enforcement and penalties in relation to long service leave arising under State or Territory legislation and not arising under section 113 of the Act. In my view, the LSL Act covers the field in relation to long service leave entitlements arising under that Act and section 323 has no application.
Claim for damages between dismissal and “acceptance of repudiation”
In his claim the applicant alleged that the respondent breached its contract of employment with the applicant by not providing work or remuneration from the time of his dismissal until the respondent’s repudiation was accepted, he claimed, on 10 December 2015. This was said to give rise to an entitlement to damages in respect of the intervening period. In the applicant’s written submissions the period for which damages were said to be due was expanded from 1 August 2015 to 16 March 2016. There was no explanation for this. The applicant relied on six cases that were said to support the claim and his written submissions reproduced what were said to be relevant passages. The cases were Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115, Spencer v Dowling (1997) 2 VR 127, Automatic Fire Sprinklers v Watson (1946) 72 CLR 435, Actrol Parts Pty Ltd v Coppi [2015] VSC 694, TWU v National Dairies Ltd (1994) 57 IR 183 and New South Wales v Paige (2002) NSWCA 235.
I have looked at each of these cases. Most, but not all, are employment law cases and deal with questions such as communication of termination of contract, what constitutes repudiation and the like. None are authority for the submission that a claim for damages or wages arises between wrongful dismissal or termination (repudiation) of a contract of employment by an employer and acceptance of the repudiation by the employee. Automatic Fire Sprinklers is authority for the contrary position. The leading case on point, which was not cited by the applicant, is Byrne v Australian Airlines Ltd (1995) 185 CLR 410. This is also authority for the contrary position. In a well-known passage Brennan CJ and Dawson and Toohey JJ said at pages 427- 428:
Of course, even if an employee who was wrongfully dismissed chooses to keep the contract of employment on foot, he or she cannot claim remuneration in respect of any period after the wrongful dismissal because the right to receive remuneration for services is dependent upon the services having been rendered (citing Automatic Fire Sprinklers v Watson at p. 465 as authority).
This claim has no merit.
Conclusion
The applicant has been successful in his claim that he was a permanent employee. Consequently he is entitled to a payment for accrued annual leave and for pay in lieu of notice. The applicant says that the failure to make payment for annual leave and in lieu of notice was a contravention of the National Employment Standards (NES) and is therefore a contravention of a civil penalty provision – section 44(1) of the Act. He seeks the imposition of a civil penalty in addition to payment for annual leave and in lieu of notice. The source of the applicant’s entitlement to annual leave and pay in lieu of notice is the AWA. These entitlements are the same as those in the NES. It is not entirely clear to me whether a breach of a contractual term in the AWA also constitutes a contravention of the NES. Clause 28, Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act states that a modern award does not apply in such a case but is silent on the applicability of the NES. Clauses 26 and 27 of Schedule 3 may suggest that the NES do apply. Neither party made submissions on the point. I am prepared to assume, without making a finding, that the respondent’s conduct is a contravention of section 44.
I do not consider it is appropriate to impose a civil penalty under section 546 of the Act. There is a useful but non-exhaustive list of relevant criteria in Kelly v Fitzpatrick (2007) 166 IR 14, [14]. In my view, the relevant factors in this case are that the parties conducted their employment relationship for many years under the misapprehension that the applicant was a casual employee. The applicant accepted this and was paid more as a result. It is not a case of exploitation or a deliberate breach of employment terms by the employer. There is no need for specific or general deterrence. The applicant will receive what might be seen as a significant windfall as a result of my findings. In the circumstances, I consider it would be inequitable to order a civil penalty.
I will make a declaration that the applicant was a permanent employee under the AWA from 8 May 2000 to 16 August 2015 and is entitled to payment for accrued annual leave at his ordinary rate of pay at the time of termination according to clause 6.1 and to payment in lieu of notice according to clause 7.2.1 of the AWA. There will also be an order for interest from the date of termination.
I will relist this matter and hear from the parties about the quantum of the amount and applicable interest and any ancillary orders.
I certify that the preceding one hundred and sixty-two (162) paragraphs are a true copy of the reasons for judgment of Judge Young
Associate:
Date: 7 February 2018
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